covid relief payment to business

[fillini00]

Do we enter the automatic payment from the government to our s-corp business for COVID relief and if so, how do we label it as income? Thank you.

[MinhT1]

The COVID relief payments which are loans such as the Economic Injury Disaster Loan (EIDL) and the Payroll Protection Program (PPP) loan are not taxable and are included in income.

They are listed on the balance sheet as liabilities on the balance sheet (until they are forgiven). The loan forgiveness is not taxable either.

[fillini00]

thank you for the reply. To clarify: this wasn't a loan, it was a provider relief payment.

[AmyC · Accepted solution]

That does make a difference. Yes, the provider relief payment is taxable according to Frequently Asked Questions about Taxation of Provider Relief.  The reporting requirements and audit proofing yourself are available here. There is a difference based on the amount you received.